Swiss referendum aims to change health insurance

Many of those in favour of the Swiss health insurance changes proposed for the 28 September 2014 referendum believe they will deliver cost savings and reduce average compulsory insurance premiums. Swiss health care costs were the second highest in the world after the US and 66 percent higher than in the UK, according to a recent analysis by the Economist Intelligence Unit. Often cited reasons for these often high costs are a lack of cost competition between medical practitioners, a system that reimburses the charges of all registered practitioners regardless of price, and the high prices of patented drugs – a 2005 Organization for Economic Cooperation and Development (OECD) ranking showed Swiss retail pharmaceutical prices to be the most expensive at nearly double the OECD average.

The referendum however is not about addressing these problems. It is focused on whether to replace 67 private health insurers with one national insurer for compulsory health insurance (LAMal). Compulsory health premiums can differ significantly. Just a quick check on bonus.ch revealed that in a typically standard case, the cost of a compulsory insurance premium ranged from CHF 533 to CHF 875 for exactly the same service, under exactly the same conditions.

Importantly, irrespective of the vote’s outcome, private insurers will still be able to compete to insure supplementary care and services not covered by compulsory insurance.

Those in favour of the proposal say that a single national fund would avoid the marketing, administrative and actuarial costs incurred by private health insurers, while opponents argue that a system which has only one insurer lacks competition and will lead to even higher prices. Although both sides might agree on the problem, they appear to disagree on the solution.